Housing soon unpayable?  - Immo

Housing soon unpayable? – Immo

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The shortage of goods and materials coupled with the energy crisis will further increase the real estate bill. At this rate, even developers are wondering if they will be able to sell their new apartments for much longer.

The trend is European. But it is particularly striking in Belgium, whose real estate market is renowned for its great stability. In four years, house prices have increased by 22.7% and apartment prices by 20.5%. A runaway especially observed since the start of the pandemic, the offer no longer meeting the demand. Increases whose magnitude obviously varies according to the region and the type of property. ING bank expects prices to rise by 5.4% for 2022 and 1.5% for 2023. A situation that only takes a whole section of Belgians a little further from the real estate dream.

This observation is not isolated. The sale prices of new homes have exploded across Europe, posting an average increase in 2021 of almost 10%. “Low-income households and the middle classes are gradually being excluded from home ownership and rental, affordable housing is becoming… unaffordable”, comments Marc Pigeon, president of Build Europe, an association that brings together European developers and builders. .

The concern grows

Another element that will increase the bill for renovations and new constructions: the rise in the price of building materials. Wood, insulating materials, steel, non-ferrous metals increased by 15 to 25% at the end of 2021. And following the war in Ukraine, they would have increased by another 12% since the start of the year, according to the Construction Confederation. A situation that worries many promoters, subcontractors and suppliers who met last week at Mipim, the international real estate fair held in Cannes. Everyone wondering who was going to have to compensate for these increases, especially for annual contracts negotiated recently. In any case, it is unlikely that they will not pass on to the end customer. “For the moment, every 15 days, we increase the price of our new apartments by 5,000 euros”, said a large Belgian promoter. “A ceiling will soon be reached, worries Eric Roubaud, director of Durabrik Wallonia. Housing could become unpayable. Some developers will soon not even activate their permits.”

And to complete the addition, we must now add the sustainability component. The Belgian building stock is a real energy sieve. Nearly 95% of the residential stock will have to be renovated by 2050 to meet European objectives. That is 4.5 million homes to renovate. Dwellings that do not have a sufficient level of PEB (energy performance of buildings) will be required to carry out renovation work. Flanders is launching this process from 2023, Brussels from 2025. Wallonia is still considering the best strategy, in particular via a third-party investor mechanism. Walloon Housing Minister Philippe Henry (Ecolo) wants in any case to force owners to renovate their property, so as to relieve tenants. It remains to be seen, again, who will bear the cost. Because, according to the UGent, 45% of households do not have sufficient means to carry out these energy works.

The trend is European. But it is particularly striking in Belgium, whose real estate market is renowned for its great stability. In four years, house prices have increased by 22.7% and apartment prices by 20.5%. A runaway especially observed since the start of the pandemic, the offer no longer meeting the demand. Increases whose magnitude obviously varies according to the region and the type of property. ING bank expects prices to rise by 5.4% for 2022 and 1.5% for 2023. is not isolated. The sale prices of new homes have exploded across Europe, posting an average increase in 2021 of almost 10%. “Low-income households and the middle classes are gradually being excluded from home ownership and rental, affordable housing is becoming… unaffordable”, comments Marc Pigeon, president of Build Europe, an association that brings together European developers and builders. .The growing concernAnother element that will drive up the bill for renovations and new constructions: the rise in the price of building materials. Wood, insulating materials, steel, non-ferrous metals increased by 15 to 25% at the end of 2021. And following the war in Ukraine, they would have increased by another 12% since the start of the year, according to the Construction Confederation. A situation that worries many promoters, subcontractors and suppliers who met last week at Mipim, the international real estate fair held in Cannes. Everyone wondering who was going to have to compensate for these increases, especially for annual contracts negotiated recently. In any case, it is unlikely that they will not pass on to the end customer. “For the moment, every 15 days, we increase the price of our new apartments by 5,000 euros”, said a large Belgian promoter. “A ceiling will soon be reached, worries Eric Roubaud, director of Durabrik Wallonia. Housing could become unpayable. Some developers will soon no longer even activate their permits.” And to complete the bill, we must now add the sustainability component . The Belgian building stock is a real energy sieve. Nearly 95% of the residential stock will have to be renovated by 2050 to meet European objectives. That is 4.5 million homes to renovate. Dwellings that do not have a sufficient level of PEB (energy performance of buildings) will be required to carry out renovation work. Flanders is launching this process from 2023, Brussels from 2025. Wallonia is still considering the best strategy, in particular via a third-party investor mechanism. Walloon Housing Minister Philippe Henry (Ecolo) wants in any case to force owners to renovate their property, so as to relieve tenants. It remains to be seen, again, who will bear the cost. Because, according to the UGent, 45% of households do not have sufficient means to carry out these energy works.

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